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Sunday, 26 May 2013

CHINA: Joblessness fears as record number of graduates hit market

Yojana Sharma22 May 2013Issue No:273

A record 6.99 million students – an increase of 190,000 on last year's
figure – will graduate from China’s higher education institutions this
year. But graduate unemployment, a scourge in recent years, shows no
sign of easing for the class of 2013.

Local media in a number of Chinese regions have been declaring 2013 as
the toughest year ‘in recent memory’ for new graduates looking for their
first job, with even the country’s top leaders voicing concerns.

Already official media is reporting that job vacancies for graduates in
Beijing are at 98,000, a year-on-year decrease of 14%, with officials
linking the drop to a slowdown in economic growth.

This month Chinese President Xi Jinping said in official statements that
employment would be a top priority, at a time when economic growth has
eased from double-digit figures to around 7.7% in the first quarter of
this year, the slowest annual rate for over a decade. The manufacturing
sector also declined slightly this year.

According to official estimates, every 1% drop in GDP growth figures wipes out around a million jobs.

Xi had paid a surprise visit to a job fair in Tianjin in eastern China
on 14 May and urged relevant authorities to assist graduates who wanted
to start their own businesses and those who were seeking employment.

Premier Li Keqiang said in the same week that the country faced an
“unprecedented challenge” in finding jobs for the record number of
graduates.

“In the first few months of the year, as economic growth has slowed, the
employment trend has remained stable but employment pressures remain,
and the problem of employment for tertiary students is particularly
prominent,” Li said in a speech.

The figures

According to official media the number of graduates is "outrunning" economic growth.

“In the past nearly 90% of graduates could find a job six months after graduation but I’m afraid the figure may only be 86% or so if the economy does not rebound in the later half of the year,” Zhang Yi, an expert in labour economics at the Chinese Academy of Social Sciences, was quoted as saying this month in the official China Daily.

The leadership has said that graduate employment will be the focus of
government efforts in coming years, with the development of service
industries, including promoting more internship programmes.

However, conditions are tough for final-year students, who graduate in July.

According to the http://MyCos.Com
website, the 2013 job contract signing rate for postgraduates is at just
26%, down 9% compared to last year. For undergraduates and junior
college students the equivalent figure is 35% and 32%, down 12% and 13%
respectively compared to last year. The number of employment contracts
signed is a key comparable indicator of job prospects.

The official Global Times this week reported a booming business
in selling fake employment contracts to graduating students, as some
universities have been demanding proof of employment before they will
provide a copy of their qualification.

Universities rely on high graduate employment rates for government
funding and other resources. The practice may be further inflating
employment figures, distorting the dire unemployment situation,
academics said.

In Shanghai the Municipal Education Commission said only 44% of around
178,000 undergraduate and graduate students in the city had signed
employment contracts so far this year – a 2% decline compared to last
year.

The commission’s Deputy Director Li Ruiyan said in a press briefing this month that the situation was “no worse” than 2009-11.

Nonetheless, he said the number of available positions in Shanghai had
declined compared to the past two years, particularly in social
services, manufacturing industries and private companies, according to
the Shanghai Daily newspaper.

Universities offering incentives

Universities and colleges have been concerned for some time about the
employment prospects of their students. Shanghai’s universities were
reportedly offering incentives for students to return to their home
towns to work. These include career training programmes, communications
skills and other courses.

For example Shanghai Dianji University was offering transportation subsidies of up to CNY1,500 (US$242) and an additional CNY800 to students from outside Shanghai willing to return to their home towns to work after graduating. Incentives would also be offered to students carrying on to postgraduate studies, the university said.

Yao Wichun, deputy director of student affairs at Shanghai Dianji
University, said there had been a 6% drop in the number of graduates
with bachelor degrees who had secured a job, compared to this time last
year.

Shanghai University was reported in Shanghai Daily as launching a training camp for students who had difficulty finding a job, to improve their skills.

There has also been a boom in private training centres that purport to
make graduates ‘job ready’, teaching them interview technique and other
soft skills sought by employers.

Shanghai students were said to have higher salary expectations compared
to those in other cities, due to Shanghai’s higher living costs, and
some ‘netizens’ speculated on the Sina Weibo social media site that
graduates were demanding too much in salary.

Officials continued to insist that graduates’ expectations were too high.